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Re: The Wrong Kind Of Diversification

Diworsification. That was a word invented by Peter Lynch (former manager of Magellan fund) to describe buying into something not really uncorrelated. Good word to remember. Dave
by Occupier
Tue Jun 25, 2013 2:40 pm
 
Forum: Investing - Theory, News & General
Topic: The Wrong Kind Of Diversification
Replies: 17
Views: 2446

Re: MUB a decent ETF for Muni exposures

I don't have a problem with your equity allocation. If your going to have one muni fund/etf I suggest you check out TFI. Last time I looked it had a less aggressive duration which is correct in this kind of market. If you went MUB you might want to reduce average duration by holding a short term mun...
by Occupier
Tue Jun 25, 2013 12:12 pm
 
Forum: Investing - Help with Personal Investments
Topic: MUB a decent ETF for Muni exposures
Replies: 5
Views: 791

Re: Emerging Market Equities Allocation

Emerging markets traditionally have a low correlation with the US and other developed markets. Also they are a bit riskier than developed. This presents an opportunity. If you hold a number of riskier non correlated assets. You reduce volatility - due to the low correlation - and increase the risk l...
by Occupier
Tue Jun 25, 2013 12:00 pm
 
Forum: Investing - Help with Personal Investments
Topic: Emerging Market Equities Allocation
Replies: 9
Views: 818

Re: "Is Your Allocation a Good Fit For Your Risk Tolerance?"

Yup. I put it differently. The one sure way to lose money is to sell out at a low and miss a recovery. If your going to panic and sell stocks you need to hold more bonds. If your going to panic and sell bonds, you need a shorter duration. You do NOT need a duration longer than intermediate under any...
by Occupier
Tue Jun 25, 2013 9:14 am
 
Forum: Investing - Theory, News & General
Topic: "Is Your Allocation a Good Fit For Your Risk Tolerance?"
Replies: 4
Views: 837

Re: Bond reassurance.... Anyone?

Here are sample durations. Short term 3, Intermediate 6, and long 15. In a rising rate environment where rates go up by 1% the funds loose 3, 6, and 15% for each 1% increase in rates. To get to historically normal rates, which may or may not happen, we are looking at a 2-3% increase over time. Do th...
by Occupier
Tue Jun 25, 2013 9:00 am
 
Forum: Investing - Help with Personal Investments
Topic: Bond reassurance.... Anyone?
Replies: 23
Views: 2226

Re: Full Portfolio Disclosure - Appreciate Any Feedback

Am I correct 15% or so in bonds. That is really high risk at your age. Given that your a bit behind the curve I might increase that to 25-30%, but the rule of thumb is age in bonds. The target fund is not as tax efficient as having a broad market index such as total stock market (or total Internatio...
by Occupier
Mon Jun 24, 2013 6:17 pm
 
Forum: Investing - Help with Personal Investments
Topic: Full Portfolio Disclosure - Appreciate Any Feedback
Replies: 6
Views: 1173

Re: Asset allocation for inherited IRA

Age in bonds is just a rule of thumb. Most agree you can depart from it to find a comfort level. Comfort level is more important. The one way to lose money for sure is to be insecure with a portfolio you control, sell out at a low and miss a recovery. Just a guess, but how about 30% bonds. Since the...
by Occupier
Sun Jun 23, 2013 5:43 pm
 
Forum: Investing - Help with Personal Investments
Topic: Asset allocation for inherited IRA
Replies: 3
Views: 201

Re: Bonds - How about Metro West -MWCRX and Osterweiss OSTIX

The first sentence is a come on used over and over by active fund managers. But over time the higher costs of actively managed funds and their occasional mistakes mean they under perform indexes. Go read some books by Larry Swedroe, or William Bernstein. They are in most library's. The new Vanguard ...
by Occupier
Sun Jun 23, 2013 12:55 pm
 
Forum: Investing - Help with Personal Investments
Topic: Bonds - How about Metro West -MWCRX and Osterweiss OSTIX ?
Replies: 2
Views: 584

Re: Moving away from cash

If I were you I would explore the wiki this site. Especially books to read, and sample portfolios. You look like you just got investments scatter shot because they sounded good at the time you had some money. When you own a lot of actively managed funds from different providers you tend to just hold...
by Occupier
Sun Jun 23, 2013 12:39 pm
 
Forum: Investing - Help with Personal Investments
Topic: Moving away from cash
Replies: 15
Views: 1880

Re: Help me pick a short term bond fund

Did you notice the DWS fund had a 68 percent turnover. A high yield and lower duration can be explained several ways. The one I think is true is that the DWS fund has purchased at a premium a lot of long term higher yielding bonds that are about to pay off. That will get the yield up, but the NAV wh...
by Occupier
Thu Jun 20, 2013 8:46 pm
 
Forum: Investing - Help with Personal Investments
Topic: Help me pick a short term bond fund
Replies: 14
Views: 1018

Re: Bond funds if interest rates rise

Remember that if interest rates rise, bond funds loose their NAV by the duration, but they then yield more. So your paid back. The actually correct way to look at duration is the bonds decline by their duration, but you only loose the duration for every 1% rise in rates, less the increase in rate. S...
by Occupier
Thu Jun 20, 2013 2:41 pm
 
Forum: Investing - Theory, News & General
Topic: Bond funds if interest rates rise
Replies: 5
Views: 1126

Re: ETF Bond Ladders

Never heard of it. My thinking is you should pick an average duration you are comfortable with and stick to it. Something in the 4-5 range is OK with me given the fact that yields are at historic lows and likely to go up at some unknown point and speed in the future. That can entail having both a sh...
by Occupier
Thu Jun 20, 2013 11:28 am
 
Forum: Investing - Help with Personal Investments
Topic: ETF Bond Ladders
Replies: 2
Views: 375

Re: Portfolio Review & Advice for Young Investor

Those T Rowe funds are about 10 times more expensive than Admiral Vanguard Total US Market and close to that for Total int. Admiral. If you went out to dinner would you order a meal that cost ten times more than a similar meal? Since your unemployed go to your library and see what books they have wr...
by Occupier
Wed Jun 19, 2013 9:08 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Review & Advice for Young Investor
Replies: 4
Views: 402

Re: Ishares vs Vanguard ETF

Yes I don't trust Ishares. The fact they are stockholder owned means that they have to make more money than Vanguard. There was no better example than with their emerging markets fund. They were not gaining assets due to low cost competition from Vanguard so they created a almost identical new EM et...
by Occupier
Wed Jun 19, 2013 2:29 pm
 
Forum: Investing - Help with Personal Investments
Topic: Ishares vs Vanguard ETF
Replies: 8
Views: 2590

Re: Do you overweight emerging markets?

Yes I am overweight in EM. I got into them and China in a fairly big way in the beginning of the last decade. I bailed on China near the top, but I hate paying capital gains taxes and did not bail on EM. So the last year or so does not make me happy. I will get to market weight eventually which is w...
by Occupier
Tue Jun 18, 2013 7:19 pm
 
Forum: Investing - Theory, News & General
Topic: Do you overweight emerging markets?
Replies: 83
Views: 6526

Re: Total "International Bond Index Fund: Why and how we hed

Good explanation Frengo. Ironically I was flipping through Larry Swedroes second book, What Wall Street Doesn't You to Know, and hit his advice about hedging on page 308 and 309. The subchapter is titled to hedge or not to hedge, that is the question. He says never hedge International Stocks because...
by Occupier
Tue Jun 18, 2013 10:14 am
 
Forum: Investing - Theory, News & General
Topic: Total "International Bond Index Fund: Why and how we hedge."
Replies: 4
Views: 1171

Re: Total International Bond Index Portfolio

Ok I posted a reply, got a rebuttal? Dave
by Occupier
Mon Jun 17, 2013 5:34 pm
 
Forum: Investing - Theory, News & General
Topic: Total International Bond Index Portfolio
Replies: 3
Views: 593

Re: Total "International Bond Index Fund: Why and how we hed

I have posted a couple of times on this subject but I have not seen any convincing answer, if someone who knows better, please explain, but I can't make sense of hedging. From about 2000 to 2007 the dollar lost about a third of it's value against the world currencies mentioned, euro, yen etc. Hedgin...
by Occupier
Mon Jun 17, 2013 5:32 pm
 
Forum: Investing - Theory, News & General
Topic: Total "International Bond Index Fund: Why and how we hedge."
Replies: 4
Views: 1171

Re: VTI or VIG as a core U.S Stock Market Holding

I am not against tilting, but you start with the total market and then tilt, not starting with just a section of the market e.g. large blend, and then maybe tilt. Dave
by Occupier
Mon Jun 17, 2013 10:20 am
 
Forum: Investing - Theory, News & General
Topic: VTI or VIG as a core U.S Stock Market Holding
Replies: 15
Views: 2065

Re: Total International Bond Index Portfolio

I would love to get straitened out by someone who knows beter,but I cant make sense of hedging. From about 2000 to 2007 the dollar lost about a third of it's value against the world currencies mentioned euro, yen, etc. Hedging would not change that, because you made money because the currency (euro ...
by Occupier
Mon Jun 17, 2013 10:17 am
 
Forum: Investing - Theory, News & General
Topic: Total International Bond Index Portfolio
Replies: 3
Views: 593

Re: M*: High Correlation In 2013 Between Treasuries & Corpor

Markets move around, if you can't stand a little volatility don't look. Right now I think you should be more concerned with duration than whether you emphasize corporates (investment grade) or treasuries. If your duration is long and credit risk high - as high yield - you need your head examined. In...
by Occupier
Mon Jun 17, 2013 9:56 am
 
Forum: Investing - Theory, News & General
Topic: M*: High Correlation In 2013 Between Treasuries & Corporates
Replies: 11
Views: 712

Re: VTI or VIG as a core U.S Stock Market Holding

Your actual question, if translated properly, is should I hold a total market fund, or a large blend fund. The former being VTI and the latter VIG. I would say VTI because of lower costs, and greater exposure to more risky (e.g. volatile) asset classes that over time have returned more. VIG is a goo...
by Occupier
Fri Jun 14, 2013 10:35 pm
 
Forum: Investing - Theory, News & General
Topic: VTI or VIG as a core U.S Stock Market Holding
Replies: 15
Views: 2065

Re: Business Travel to Tijuana/Tecate/Ensenada

I have been to all the places you mention in the last year. I travel by motorcycle. You can cross the boarder in Tecate in a flash and then it's a nice rural two lane road to Ensenada with one or two checkpoints. I have never felt unsafe on the road or in either cities but I would not be out late at...
by Occupier
Thu Jun 13, 2013 9:59 am
 
Forum: Personal Consumer Issues
Topic: Business Travel to Tijuana/Tecate/Ensenada
Replies: 35
Views: 2256

Re: Vanguard muddles message by mixing up the 2 int'l bond f

Boy, attitudes sure changed fast. The conventional wisdom till last month was, take your currency risk with equities not bonds. So most would just hold a set amount of international stocks and no foreign bonds. Now it's diversify your interest rate risk by having 20% of your bonds abroad, but don't ...
by Occupier
Wed Jun 12, 2013 8:01 pm
 
Forum: Investing - Theory, News & General
Topic: Vanguard muddles message by mixing up the 2 int'l bond funds
Replies: 12
Views: 1551

Re: A good core bond fund

Generally I agree with Nisiperius, but the way the bond market is today, I don't think looking at past performance is a good idea. 1) Since about the 80's the direction of rates is downward. 2) With rates reaching points where they can't go lower, expecting historic returns to repeat themselves is m...
by Occupier
Tue Jun 11, 2013 1:19 pm
 
Forum: Investing - Help with Personal Investments
Topic: A good core bond fund
Replies: 12
Views: 1865

Re: portfolio review request

I don't have a problem with the allocation. But I don't think I can say a thing about drawdown. I don't know what kinda money we are talking about, and might not comment anyway. I do think if you want to be more aggressive in withdrawing funds, you ought to have something which would produce more yi...
by Occupier
Mon Jun 10, 2013 5:54 pm
 
Forum: Investing - Help with Personal Investments
Topic: portfolio review request
Replies: 2
Views: 266

Re: can you profit from relative bond valuations?

Shucks, from the title I thought it was just a question of picking the right rich uncle.
by Occupier
Mon Jun 10, 2013 5:42 pm
 
Forum: Investing - Theory, News & General
Topic: can you profit from relative bond valuations?
Replies: 2
Views: 342

Re: Which Emerging Market Fund?

Well duh. Which fund is less expensive. You lose a lot of appreciation to costs. Especially if your talking about a lifetime. Further you did not tell us how much your adviser would charge to get you the DFA fund. Dave
by Occupier
Fri Jun 07, 2013 7:59 pm
 
Forum: Investing - Help with Personal Investments
Topic: Which Emerging Market Fund?
Replies: 8
Views: 743

Re: Asset Protection (401k, Roth, 403b, 457)

I think having adequate liability insurance is all the asset protection most people need. You are correct. In California ERISA plans do offer more protection against seizure from a creditor than IRA's. I suppose if you or your parents are really concerned about this they could establish an 401 for t...
by Occupier
Sun Jun 02, 2013 7:25 pm
 
Forum: Personal Finance (Not Investing)
Topic: Asset Protection (401k, Roth, 403b, 457)
Replies: 11
Views: 1741

Re: Total International Bond Fund

I will tell you I hate to think I am betting against Vanguard, because that usually puts you one the loosing side, but I can't understand their position on hedging. 1) If your going to buy global bonds, which only yield slightly more than US, e.g. not much, why add the expense of hedging away curren...
by Occupier
Sun Jun 02, 2013 2:14 pm
 
Forum: Investing - Theory, News & General
Topic: Total International Bond Fund
Replies: 4
Views: 801

Re: Investing in Stocks Funds When Market Is High

I remember how things were in late 1999. I don't think things are nearly as "high" now as then. So you might not be buying into a market as likely to go down now as then. Also international stocks are quite low, so you can get them without the same concern about buying into a "high.&q...
by Occupier
Sat Jun 01, 2013 3:21 pm
 
Forum: Investing - Help with Personal Investments
Topic: Investing in Stocks Funds When Market Is High
Replies: 10
Views: 1475

Re: Portfolio Review

The Wellington fund is not all that tax efficient i.e taxable bonds and dividend paying large Value stocks are less efficient than having a total stock market fund and tax free bonds or follow the advice in the next sentence. Just because you might retire in 2045 doesn't mean you have to own that ye...
by Occupier
Sat Jun 01, 2013 3:12 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Review
Replies: 10
Views: 844

Re: What's the right allocation to GNMA bonds?

0% is the right allocation, except some in a fund like total bond are OK. I have come to the view Larry is right about these bonds. Basically when interest rates go down people refinance and just when you want a long duration bond, they pay off early. When interest rates go up no one wants to refina...
by Occupier
Sat Jun 01, 2013 10:06 am
 
Forum: Investing - Theory, News & General
Topic: What's the right allocation to GNMA bonds?
Replies: 7
Views: 622

Re: Utilities are down 10% in may!

I don't think the people who hold utilities care to much about the short term movements of their price, only that their dividends don't get cut. As a retired person I will tell you those dividends are sure nice when you go to the store to buy food for dinner. Dave
by Occupier
Fri May 31, 2013 10:16 pm
 
Forum: Investing - Theory, News & General
Topic: Utilities are down 10% in may!
Replies: 13
Views: 1460

Re: Why no Intermediate-Term (I-T) Corporate Bond Fund?

The Vanguard fund Intermediate Term Investment Grade fund used to be 100% Corporates. I will never forget the howls of protest at the old Morningstar list when it changed it's prospectus to include holding some government bonds. But it is still primarily an actively managed corporate fund. It's perf...
by Occupier
Fri May 31, 2013 10:11 pm
 
Forum: Investing - Help with Personal Investments
Topic: Why no Intermediate-Term (I-T) Corporate Bond Fund?
Replies: 8
Views: 1056

Re: Time to dump bond funds?

I don't agree with a lot that has been posted here. Interest rates were at historic lows a month ago with the most likely direction up at some unknown time and rate of increase. I mean it should be obvious that when they are close to zero they cant go much lower. If I were you I would exchange the l...
by Occupier
Fri May 31, 2013 10:00 pm
 
Forum: Investing - Help with Personal Investments
Topic: Time to dump bond funds?
Replies: 25
Views: 2845

Re: bond allocation in Vanguard Target Retirement Funds

One possible rationalization for the lower bond ratio is that when you investing for a long time like 30 years you can take more equity risk. I agree that the target funds have higher than standard Boglehead bond ratios. You can just do like I do, lie about your age, and then invest your age in bond...
by Occupier
Fri May 31, 2013 9:39 pm
 
Forum: Investing - Theory, News & General
Topic: bond allocation in Vanguard Target Retirement Funds
Replies: 10
Views: 764

Re: Military physician moonlighting...LLC?

Before you decide on incorporating just for the retirement benefits go to http://www.irs.gov and run IRA SIMPLE through the search engine. It is an IRA but is designed for people who don't have 401's. It has a lot larger contribution limit than an ordinary IRA. I don't know if military types can use...
by Occupier
Thu May 30, 2013 8:30 pm
 
Forum: Personal Finance (Not Investing)
Topic: Military physician moonlighting...LLC?
Replies: 15
Views: 2567

Re: trading costs matterave

A lot of people don't realize how much trading costs have gone down. I remember when you had to call your broker, listen to him talk about his score for the last golf game, then you told him how you did last time you went fishing, and you paid a couple of hundred a trade. Now you just pay pocket cha...
by Occupier
Thu May 30, 2013 12:27 pm
 
Forum: Investing - Theory, News & General
Topic: trading costs matter
Replies: 13
Views: 1081

Re: Bonds - Just starting out HELP! :)

Generally you want some bonds to reduce volatility. So my vote is with the 90/10 of the various options. Keep you average duration around 5 or less and you wont be taking an unacceptable interest rate risk. The real reason why I decided to respond is that if your a high income person with a long ter...
by Occupier
Tue May 28, 2013 7:58 pm
 
Forum: Investing - Help with Personal Investments
Topic: Bonds - Just starting out HELP! :)
Replies: 2
Views: 367

Re: Hedgefund investing for the masses

No it sounds like fewer people are stupid enough to throw their money at these high cost - mostly low return, investment vehicles. Dave
by Occupier
Tue May 28, 2013 7:46 pm
 
Forum: Investing - Theory, News & General
Topic: Hedgefund investing for the masses
Replies: 6
Views: 732

Re: Selling Art

I have sold art for estates. Generally I start by going to http://www.Sothebys.com and http://www.christies.com and sending in an electronic picture, measurements etc. to the right department. Their response is usually on the high side. That is because they want you to list with them. Then if you do...
by Occupier
Tue May 28, 2013 7:44 pm
 
Forum: Personal Consumer Issues
Topic: Selling Art
Replies: 8
Views: 622

Re: REITs... buy more?

Yes 20% is too high. First why do you hold REITS which are just less then 2% of the market by market cap? The answer per Fama/French is that they don't correlate with other asset classes. That means they tend to go up when other classes don't do well, and go down when other classes do well. Followin...
by Occupier
Thu May 02, 2013 2:30 pm
 
Forum: Investing - Help with Personal Investments
Topic: REITs... buy more?
Replies: 39
Views: 4519

Re: Finally ready to solicit some opinions [Physician]

Since you did not mention "her inactive 403" are you intending to roll that into an IRA? That is what I would have done yesterday. The higher costs there are going to add up to a lot of lost appreciation over 30 or so years. The other thing I notice is your proposed new allocation seems to...
by Occupier
Wed May 01, 2013 10:54 am
 
Forum: Investing - Help with Personal Investments
Topic: Finally ready to solicit some opinions [Physician]
Replies: 5
Views: 1834

Re: Seeking help with portfolio

Why waste your time with someone who does not want to listen? He has a hodgepodge of stuff that he read some article about and decided to buy. I.E. no coherent plan. He has next to no bonds and 32% of his money is in cash not even beating inflation and waiting for him to get excited about something ...
by Occupier
Tue Apr 30, 2013 7:34 pm
 
Forum: Investing - Help with Personal Investments
Topic: Seeking help with portfolio
Replies: 3
Views: 360

Re: Am I too conservative?

What I see and don't like is your tax placement. You have each account as a similar portfolio. In fact it's all you money and should be one portfolio with funds placed based on tax efficiency. In other words the three accounts don't need to look the same. In order of tax efficiency worst to best; ta...
by Occupier
Sun Apr 28, 2013 8:38 pm
 
Forum: Investing - Help with Personal Investments
Topic: Am I too conservative?
Replies: 17
Views: 1891

Re: Bond allocation for a 30 year old

I take it your thinking of the cash value pension is a sort of bond. I tend to agree. As a result you can have a lower bond percent in other accounts. I don't know the figure because I don't know how big the cash value pension is. There is nothing wrong with the total bond index available to you. I ...
by Occupier
Sun Apr 28, 2013 8:27 pm
 
Forum: Investing - Help with Personal Investments
Topic: Bond allocation for a 30 year old
Replies: 5
Views: 868

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

You can roll the old IRA and 401 into a new IRA. Vanguard or other low cost fund family is fine. Now the expense in 10 years is fine if you allow for it in the taxable account. I would have a slightly higher bond allocation and call that my reserve for that expense. Most rebalance once or twice a ye...
by Occupier
Sun Apr 28, 2013 8:19 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3011

Re: Portfolio Review Request

In the taxable the expense ratio's are horrendous. That extra 1% a year adds up to a lot of lost appreciation over 20 years. Also international emerging markets are very tax efficient, so some VXUS (Vanguard international emerging total market) or the Fidelity equivalent is in order for this account...
by Occupier
Sat Apr 27, 2013 9:15 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Review Request
Replies: 10
Views: 1071

Re: Telemarketers

If you want to complain to the people who enforce the do not call law, go to www.FTC.gov and in their consumer protection section you can fill out a complaint online. They do periodically chase the bad guys out of business. Dave
by Occupier
Tue Apr 23, 2013 9:51 pm
 
Forum: Personal Finance (Not Investing)
Topic: [stopping] Telemarketers
Replies: 29
Views: 1738
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